Raymond Limited · NSE:RAYMOND
Raymond — Q2 FY2020 Earnings Presentation
56 slides from Raymond's earnings presentation, October 2019
Slide 1: Result Presentation
Result Presentation Quarter ended 30th September, 2019
Slide 2: Disclaimer
Disclaimer • The particulars of this presentation contain statements related but not limited to revenues, financial results and supplemental financial information which has been compiled by the management, not to be construed as being provided under any legal or regulatory requirement and are not in
Slide 3: Table of Contents
Table of Contents Company Overview 04 Market Overview 10 Initiatives and Awards 12 Financial Highlights 15 Ind-As 116 Impact 22 Performance of Segments 27 Way Forward 49 Annexures 51 3
Slide 4: Company Overview
si Raymon Company Overview
Slide 5: Raymond Group: Introduction
Raymond Group: Introduction SUITING SHIRTING APPAREL RETAIL PRESENCE GARMENTING ENGINEERING REAL ESTATE DENIM FMCG A diversified group with interests in Textile & Apparel sectors as well as presence across diverse segments such as Real Estate, FMCG, Engineering in national and international markets
Slide 6: Raymond: A Group with Strong Leadership Position
Raymond: A Group with Strong Leadership Position No 1 player in 5th largest Suit 1st organised retailer Manufacturer of Near 100% worsted suiting manufacturer in in India world’s finest fabric consumer awareness fabrics in India the World One of the world’s 3rd largest player One of the largest Only
Slide 7: Raymond Group at a Glance
Raymond Group at a Glance Branded Textile Promoter Made to Measure Suiting B2C Shirting Group (MTM) Branded Apparel Raymond Apparel (100%) 44% Garmenting Dress Masters Suit Celebration Everblue Apparel Silver Spark (100%) Apparel (100%) (100%) Apparel (100%) High Value Cotton Ethiopia *(100%) Shirti
Slide 8: Raymond Group Leadership Team
Raymond Group Leadership Team led by Gautam Hari Singhania Chairman and Managing Director Raymond Limited Nirvik Singh Rajeev Bakshi Ravi Uppal Non Executive Chairman Non Executive Chairman Non Executive Chairman Raymond Apparel Limited JK Helene Curtis Limited Ring Plus Aqua Limited Current – COO o
Slide 9: Management Team
Management Team Sanjay Bahl Sanjay Behl Vipin Agarwal S L Pokharna K A Narayan Group CFO CEO-Lifestyle President – President – President – Ex- Landmark, HUL Ex- Rcom, HUL Corporate Commercial Human Resources Ex – Deepak Fertilizers, 36 years of Ex- Wockhardt Jindal Stainless Steel experience Sudhans
Slide 10: Market Overview
si Raymon Market Overview 10
Slide 11: Market Overview
Market Overview Textile • Demand remained weak across markets on account of liquidity crisis and slow down in rural consumption • Margins remain under pressure due to weak consumer demand Apparel & Retail • Moderate revenue growth amid early onset of festive season • Margins impacted on account of h
Slide 12: Initiatives and Awards
si Raymon Initiatives and Awards 12
Slide 13: Initiatives
Initiatives Broadening Retail Horizon through Asset light expansion Ethnix Mini TRS 5 New Ethnix Stores in Expansion of the small Q2FY20, totaling to store formats continues – 13 stores as at Sep’19 318 stores as at Sep-19 Style Play Tailoring Hubs 3 New Style Play Stores 8 tailoring hubs added in i
Slide 14: Awards
Awards Amravati Plant : Park Avenue bags a Annual Report Award: Efficiency Award 2019 prestigious award Mercomm Global PA DIY won Most Admired Raymond won “ARC Awards” Amravati Plant won Gold Retail Tech Implementation from Mercomm Global for Award from Apex India Plant of The Year in the Customer A
Slide 15: Financial Highlights
si Raymon Financial Highlights 15
Slide 16: Financial Highlights – Q2FY20
Financial Highlights – Q2FY20 Revenue (₹ Cr) EBITDA (₹ Cr) & Net Profit (₹ Cr) EBITDA margin % 2% 11.4% 1,876 1,913 10.1% 214 193 39% 88 63 -10% Q2 FY19 Q2 FY20 Q2 FY19 Q2 FY20 Q2 FY19 Q2 FY20 Net Debt to Equity Ratio NWC days* A&SP & % to revenue 5.9% 4.2% 1.2 1.1 109 108 110 80 Sep'18 Sep'19 Sep'1
Slide 17: Consolidated Results – Q2 & H1FY20
Consolidated Results – Q2 & H1FY20 Pre Ind-AS 116 Particulars (INR Cr) Q2 FY20 Q2 FY19 Y-o-Y% YTD-Sep'19 YTD-Sep'18 Y-o-Y% Net Revenue 1,913 1,876 2% 3,380 3,165 7% Net Sales 1,883 1,848 2% 3,318 3,098 7% EBITDA 193 214 -10% 298 322 -7% EBITDA margin 10.1% 11.4% 8.8% 10.2% PBT before exceptions 76 1
Slide 18: Segment Results – Q2 FY20
Segment Results – Q2 FY20 Q2FY20 - Pre Ind-As 116 Revenue EBITDA Growth Particulars (INR Cr) (INR Cr) (INR Cr) Margin Growth (YoY%) Branded Textiles 869 -2% 129 14.8% -26 bps Branded Apparels 529 9% 20 3.8% 97 bps Garmenting 233 6% 11 4.7% -249 bps High Value Cotton Shirting 161 -8% 27 16.7% 131 bps
Slide 19: Segment Results – H1 FY20
Segment Results – H1 FY20 H1FY20 - Pre Ind-As 116 Revenue EBITDA Growth Particulars (INR Cr) (INR Cr) (INR Cr) Margin Change (YoY%) Branded Textiles 1469 0% 159 10.8% -123 bps Branded Apparels 842 11% 36 4.3% 163 bps Garmenting 423 11% 14 3.3% -333 bps High Value Cotton Shirting 335 1% 54 16.0% 206
Slide 20: Balance Sheet & Performance Indicators (Pre Ind-AS 116)
Balance Sheet & Performance Indicators (Pre Ind-AS 116) Particulars (INR Cr) Q2 FY19 Q2 FY20 Net Worth 1,912 2,081 Net Debt 2,280 2,378 Key Ratios Sep'18 Sep'19 Net Debt / Equity 1.2 1.1 Net Working Capital Days* 109 108 Net Working Capital Days (Excl. Real 109 105 Estate) * *Trailing 12 months basi
Slide 21: Half Yearly Cashflow
Half Yearly Cashflow Particulars (₹Cr) H1 FY20 Operating Profit less Taxes & Exc. Items 300 Working Capital Changes -365 Cash Flow from operating activities (a) -65 Net purchase of Fixed Assets -124 Movement in Investments 77 Interest & dividend income 40 Cash Flow from Investing Activities (b) -7 I
Slide 22: Ind-As 116 Impact
si Raymon Ind-As 116 Impact 22
Slide 23: IND AS 116 – Overview
IND AS 116 – Overview (effective from 1st April 2019) • No distinction between Finance Lease & Operating Lease • Accounting Treatment • All leases to be recognized in the balance sheet as Asset and Liability • ‘Lease Obligation’ is measured at present value of lease payments to be made over lease te
Slide 24: IND AS 116 – Impact on Financials
IND AS 116 – Impact on Financials Balance Sheet Income Statement IND IND IND AS17 IND AS116 AS17 AS116 Assets - Revenue - Other Expenses - Liabilities - EBITDA - Depreciation - Off Balance Assets EBIT - Sheet – Rights / - Obligations Liabilities Interest - PBT - 24
Slide 25: IND AS 116 – Raymond Adoption
IND AS 116 – Raymond Adoption • Raymond has seamlessly transitioned to IND AS 116 w.e.f 1st April 2019 • No re-statement of past period • Raymond has lease terms ranging from 3 to 9 yrs on average • Non cancellable minimum period – as per the agreements 25
Slide 26: Q2 FY20 - IND AS 116 – Lease Impact Summary
Q2 FY20 - IND AS 116 – Lease Impact Summary Particulars (INR Cr) Pre IND AS 116 Impact Post IND AS 116 Net Revenue 1,913 0 1,913 Net Sales 1,883 0 1,883 EBITDA 193 43 237 EBITDA margin 10.1% 2.3% 12.4% Depreciation 52 34 86 EBIT 141 10 151 Interest Cost 66 13 79 PBT before exceptions 76 -4 72 PBT ma
Slide 27: Performance of Segments
si Raymon Performance of Segments 27
Slide 28: Branded Textile
Branded Textile
Slide 29: Branded Textile
Branded Textile Particulars (INR Cr) Q2 FY20 Q2 FY19 % Chg H1FY20 H1FY19 % Chg Net Sales 869 884 -2% 1,469 1,473 0% EBITDA 129 133 -3% 159 177 -10% EBITDA margin 14.8% 15.1% -26 bps 10.8% 12.0% -123 bps Post Ind-AS; EBITDA for Q2FY20 is Rs 139 Cr and EBITDA Margin is 16.0% • Topline de-growth by 2%
Slide 30: Branded Textile
Branded Textile Suiting Suiting grew marginally by 1% - Lower off-take in the wholesale channels due to lower secondary sales • The growth was led by expansion to new smaller outlets through low priced products • The benefit from the price hike undertaken got impacted due to the adverse product mi
Slide 31: Branded Apparel
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Slide 32: Branded Apparel
Branded Apparel Particulars (INR Cr) Q2 FY20 Q2 FY19 % Chg H1FY20 H1FY19 % Chg Net Sales 529 484 9% 842 761 11% EBITDA 20 14 47% 36 20 79% EBITDA margin 3.8% 2.8% 97 bps 4.3% 2.7% 163 bps Post Ind-AS; EBITDA for Q2FY20 is Rs 49 Cr and EBITDA Margin is 9.3% • Branded Apparel growth driven by Strong
Slide 33: Retail Network
Retail Network
Slide 34: Exclusive Retail Network
Exclusive Retail Network 2.4 mn 2.4 mn 58 additions sq ft sq ft 34 24 1,501 0 1,458 9 0 6 378 EBO 360 MTM * 67 15 closures 67 TRS 1,031 1,056 Jun19 Jun 19 TRS MTM EBO TRS MTM EBO Sep 19 • During the quarter Added 58 new stores and closed 15 stores 97% of stores added on Franchisee basis in line
Slide 35: Strong Distribution Network
Strong Distribution Network Branded Textile 4 • 20,000+ points of sale across 52 4 600+ cities and towns 16 29 • 185+ Wholesalers 44 55 • 1,350+ MBOs 2 • Across Raymond Shop (TRS) - 60 159 11 1 Tier I to VI towns 71 1 83 67 27 84 1 Branded Apparel 18 • Presence in over 500 cities and 20 towns 228 •
Slide 36: Garmenting
Garmenting
Slide 37: Garmenting
Garmenting Particulars (INR Cr) Q2 FY20 Q2 FY19 % Chg H1FY20 H1FY19 % Chg Net Sales 233 219 6% 423 382 11% EBITDA 11 16 -31% 14 25 -45% EBITDA margin 4.7% 7.2% -249 bps 3.3% 6.6% -333 bps Post Ind-AS; EBITDA for Q2FY20 is Rs 12 Cr and EBITDA Margin is 5.3% • Growth led by exports to Japan markets •
Slide 38: High Value Cotton Shirting
High Value Cotton Shirting
Slide 39: High Value Cotton Shirting
High Value Cotton Shirting Particulars (INR Cr) Q2 FY20 Q2 FY19 % Chg H1FY20 H1FY19 % Chg Net Sales 161 176 -8% 335 333 1% EBITDA 27 27 0% 54 47 16% EBITDA margin 16.7% 15.4% 131 bps 16.0% 14.0% 206 bps No impact of Ind-AS 116 • Sales impacted by 8% mainly due to production impact in Kolhapur plant
Slide 40: Tools & Hardware Auto Components
Tools & Hardware 40 Auto Components
Slide 41: Tools and Hardware
Tools and Hardware Particulars (INR Cr) Q2 FY20 Q2 FY19 % Chg H1FY20 H1FY19 % Chg Net Sales 103 104 -1% 194 200 -3% EBITDA 14 15 -8% 20 23 -11% EBITDA margin 13.3% 14.4% -105 bps 10.5% 11.5% -96 bps No impact of Ind-AS 116 • Revenue de-growth mainly due to slowdown in domestic files business • EBITD
Slide 42: Auto Components
Auto Components Particulars (INR Cr) Q2 FY20 Q2 FY19 % Chg H1FY20 H1FY19 % Chg Net Sales 52 64 -18% 120 127 -5% EBITDA 8 14 -44% 22 29 -27% EBITDA margin 15.4% 22.6% -713 bps 17.9% 23.3% -537 bps No impact of Ind-AS 116 • Revenue de-growth due to sector slowdown which impacted orders from key accoun
Slide 43: Raymond Realty
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Slide 44: Raymond Realty – Go Beyond
Raymond Realty – Go Beyond Raymond’s maiden venture into Real Estate Development Overall 20 acres of residential development Project Phase 1: ~14 acre of development Phase 1 • Total 10 towers with ~2.8 mn sq.ft of saleable area Project Details • Total 2BHK units available for sale: 2,800 • RERA regi
Slide 45: Excellent Connectivity & Eco-system
Excellent Connectivity & Eco-system
Slide 46: Co-Creators
Co- Creators Master Architect Structural Consultant Interior Designer Construction Contractor Landscape Green Consultant
Slide 47: Financial Update – KPI's
Financial Update – KPI’s Particulars FY19* Q2FY20 H1FY20 Till Sep-19 Bookings: - No. of bookings 238 83 426 664 - Area (Mn. Sq.ft.) 0.23 0.08 0.41 0.64 - Value of Bookings (Rs. Cr.) 243 93.00 463 704 Customers Collection (Rs. Cr.) 7 77 124 131 Capital Employed^ 185 30 109 297 Particulars(₹ Cr) FY19*
Slide 48: Construction Update
Construction Update Tower - A Tower - B Tower - C Construction progress in line with schedule despite disruptions due to longer monsoon All 3 towers plinth level completed
Slide 49: Way Forward
49 Way Forward si Raymon
Slide 50: Way Forward
Way Forward • Continued lower consumer demand witnessed in October and liquidity concerns continue to affect the trade channels • Overall, we expect H2 to remain modest in terms of growth & consumer sentiment. However, there could be some positive elasticity in the Raymond portfolio due to extended
Slide 51: Annexures
Annexures 51
Slide 52: Consolidated Financial Overview
Consolidated Financial Overview Revenue (Rs Cr) Profitability Ratios 11.2% 9.6% 9.1% 10.5% 7.7% 9.1% 8.9% 6.8% 5,296 5,509 6,025 6,708 FY16 FY17 FY18 FY19 FY16 FY17 FY18 FY19 EBITDA Margin ROCE India Global Leverage Indicators 4.0 FY 19 Revenue by 3.5 Geography 83% 17% 3.2 2.9 1.0 1.0 1.0 1.0 FY 19:
Slide 53: Profit & Loss Account Summary
Profit & Loss Account Summary Particulars (Rs Cr) FY16 FY17 FY18 FY19 Revenue 5,296 5,509 6,025 6,708 EBITDA 506 423 546 702 EBITDA % 9.6% 7.7% 9.1% 10.5% EBIT 347 266 376 506 EBIT % 6.6% 4.8% 6.2% 7.5% PBT before exceptional 158 88 192 273 PBT % 3.0% 1.6% 3.2% 4.1% Net Profit 85 26 135 168 Note: FY
Slide 54: Segmental Sales & EBITDA Margin Summary
Segmental Sales & EBITDA Margin Summary Particulars (Rs Cr) FY16 FY17 FY18 FY19 Branded Textile Revenue 2,702 2,714 2,915 3,153 FY19 LTL Margin: EBITDA % 17.3% 14.1% 15.7% 13.8% 14.7% Branded Apparel Revenue 1,119 1,270 1,424 1,647 FY19 LTL Margin: EBITDA % 2.0% -1.0% 1.6% 3.7% 4.2% High Value Cotto
Slide 55: Segmental Sales & EBITDA Margin Summary
Segmental Sales & EBITDA Margin Summary Particulars (Rs Cr) FY16 FY17 FY18 FY19 Garmenting Revenue 593 639 691 779 FY19 LTL Margin: EBITDA % 8.3% 8.4% 5.2% 5.1% 5.9% Tools & Hardware* Revenue 394 350 365 401 FY19 LTL Margin: EBITDA % 4.7% 2.0% 9.0% 10.7% 10.7% Auto Components* Revenue 176 164 218 25
Slide 56: Thank You
an raymond Thank You www.raymond.in